Jury awards California truckers $54M in Wal-Mart wage suit

Thursday

Nov 24, 2016 at 8:53 AM

Kristin J. Bender

SAN FRANCISCO | Wal-Mart intentionally failed to pay hundreds of truck drivers in California the minimum wage for duties such as inspecting and washing their vehicles, a federal jury decided Wednesday, awarding the workers more than $54 million in damages and opening up the retail giant to additional penalties.

Seven jurors returned the verdict in a lawsuit that also accused the company of not properly paying drivers for layovers. Wal-Mart argued that truckers are paid for activities that include maintenance tasks and that they are not working during layovers.

Scott Edelman, an attorney for the retailer, said he was pleased to win a majority of the claims.

"The findings on the other claims were dictated, we believe, by juror instructions that the court gave that were wrong and will be the subject of post-trial motions and, if necessary, an appeal," he said.

A spokesman said Arkansas-based Wal-Mart Stores Inc. is likely to appeal. The company believes "that our truck drivers are paid in compliance with California law and often in excess of what California law requires," Randy Hargrove said in a statement.

Wal-Mart drivers are among the highest-paid in the industry, earning from about $80,000 to over $100,000 per year, Hargrove said.

More than 800 drivers who worked for Wal-Mart between October 2005 and October 2015 sought $72 million in damages, the bulk of it for layovers when they say they are required to stay with their trucks.

Their attorneys said at trial that additional damages and penalties could push the total Wal-Mart owed to more than $150 million. A judge will determine civil penalties.

"The facts in the law clearly show that these drivers were not paid for all the duties they did, like the pre-and post-trip inspections, and they were not paid for their rest breaks," said Butch Wagner, attorney for the drivers.

The jury sent a clear message, said William B. Gould, an emeritus professor at Stanford Law School.

"Any time a corporation in the public eye, as Wal-Mart is, is found to have engaged in labor law violations, that’s going to send a message to both the public and to employees and it’s going to be a strong deterrent to future misconduct," said Gould, who also served as chairman of the National Labor Relations Board in the 1990s.

Wal-Mart Stores Inc. — the nation’s largest private employer — has faced other criticism over its pay and treatment of U.S. employees.

The company announced last year that it was giving a raise to about a half-million U.S. workers. The raises were part of a $1 billion investment that the retailer said also was intended to give workers more opportunities to advance and more consistent schedules.

Wal-Mart drivers are not paid by the hour. Wages are based on mileage and specified activities.

The drivers’ attorneys pointed to a ruling in their favor from U.S. District Judge Susan Illston, who said last year that Wal-Mart would be in violation of California law if it enforced its driver pay manuals because they say no pay is earned for certain tasks.

The company argued that it paid drivers for activities that included other, smaller tasks and could not have a separate payment designation for everything they did, some of which took just minutes.

At trial, Edelman likened what the plaintiffs were asking for to a baker who charges a flat fee for a cake, not the individual tasks of buying the eggs, putting the cake in the oven or cleaning the dishes after.

"When you pay a baker $20 to bake a cake, what are you paying that baker to do?" Edelman said during his closing argument. "Is it just to put the cake in the oven for however long? Because that’s essentially what the plaintiffs are arguing."

Wal-Mart pays drivers $42 for 10-hour overnight layovers as an extra benefit, but it does not control their time during that period, Edelman said. Drivers are free to go to the movies, exercise or do other activities, he said.

Associated Press writer Janie Har contributed to this report.

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